Ivory Coast’s digital finance market is unsettled as disruption by Senegalese mobile money platform Wave Mobile threatens to put rural mobile wallet agencies out of business.

An agent who has set up operations in Abidjan said: “We are losing business and have to venture into other business lines to ensure revenue flows sustain our costs and earn us a profit. Commission income is very low since arrival of Wave; I don’t know how agents in rural areas are managing because here in the city it’s unbearable.”

Market analysts believe rural agents, who face low foot traffic in less densely populated areas, suffer much more than their urban counterparts from low transaction charges.

In the Ivory Coast, more rural-based mobile money agents are staggering or closing “as the agent business is not of interest anymore due to decreasing” profits.

In urban areas, master mobile money agents, who typically work non-exclusively with most DFS providers and engage in non-financial business lines, are shifting investments from their mobile money business to other side businesses in agriculture or commerce.

In October 2022 digital finance advisory company Mondato noted: “A shift in business models for agents is not only necessary, but imminent”. This was especially so as new players such as Wave and others that have zero or near zero rated transaction charges “foray into markets” across the continent.

The World Bank and Consultative Group to Assist the Poor (CGAP) are now calling on the Ivory Coast’s government to accelerate digitisation of state payments and review taxes enforced on rural mobile money agents.

An excerpt from a report by CGAP and the World Bank reads, “In turn, rural customers using these agents find it harder to get their Cash-in Cash-out (CICO) requests served. This is making it difficult for rural customers —who depend more on feature phones and hold cash— to use mobile money services offered, even though services are now cheaper, thanks to the innovations by new disruptive players such as Wave.”

When it forayed into Ivory Coast, Wave pivoted its operations on a mobile app for money transfers. For customers without smartphones, it issued a card with a QR code to process transactions.

It also lowered customer money transfer fees to 1% of the transfer value - a significant drop from the 6% average in the complex tiered fee system used before. It also offers free cash-out for customers.